As indicated in the previous section, the SLA is used to guide this study. The approach, which was developed by the Department for International Development (DFID), concerns itself with the “creation of livelihood opportunities and strategies of poor and excluded people” (Neefjes, 2000: 91). The SLA is adopted since it is a holistic, people-centred approach that recognises that poor people are not just passive recipients of development, but have a sense of agency to define their own development agenda. It further promotes participation (DFID, 1999) to ensure sustainable development, which is defined as “development that meets the needs of the present without compromising the ability of future generations to meet their own needs” (Brundtland Report cited in UNDP, 2003: 2). Ultimately, the SLA puts people at the centre of development to achieve the goal of sustainable development. It recognises that the poor are the managers of complex asset portfolios. It further seeks to understand the multiple livelihoods that people pursue and the changes occurring over time, the resources used in livelihood activities, the constraints faced and available opportunities. The approach aims to build the capacity of local people in order for them to be better able to pursue their own livelihood strategies. The SLA requires action to enhance people’s participation in devising their livelihood intervention options and adopting people-centred strategies; raise the human capital status of households and communities; combat the devastating the impact of HIV and AIDS epidemic; promote formal and informal employment; and ensure appropriate utilisation of natural resources (UNDP, 2001).
The Core Principles of the Sustainable Livelihoods Approach
According to DFID (1999:7) a programme which is oriented toward poverty reduction activities should posses the following core elements:
People-centred: This puts people at the centre of development whilst using their strengths and assets. Hence, it is a strengths-based approach to development as opposed to focusing on people’s weaknesses and deficits (Mathie and Cunningham, 2003;
McKnight and Kretzman, 1993).
Responsive and participatory: Participation is at the heart of community development.
Genuine participation requires active community involvement in all stages of a
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community project, particularly in the decisions that directly affect them (Hogan, 2002).
Partnerships can be formed with poor people and their organisations, as well as with the public and private sectors. Partnerships should be transparent agreements, based on shared goals. Goldman, Franks, Toner, Howlett, Kamuzara, Muhumuza, and Tamasane (2004:4) argue that it is important to understand the nature of the partnership and the real locus of power, as some interventions inhibit equal partnerships. This requires the identification of stakeholders and ensuring meaningful participation in development programmes. The inclusion of poor people and other traditionally excluded groups in priority setting and decision making is critical to ensure that limited public resources build on local knowledge and priorities, and in order to build commitment to change.
However, sustaining inclusion and informed participation usually requires changing the rules in order to create space for people to debate issues and participate directly or indirectly in local and national priority setting, budget formation, and the delivery of basic services (World Bank, 2002).
Sustainability: There are five key dimensions to sustainability: economic, institutional, social, environmental and resilient. All are important and a balance must be found between them (Neefjes, 2000).
Conducted in partnership: Partnerships can be formed with poor people and their organisations, as well as with the public and private sector. Partnerships should be transparent agreements based on shared goals (Kadozo, 2009:44).
Empowerment: This is a contested concept that means different things to different people. Scholars agree that empowerment is about expanding people’s opportunities to make choices in life; that is, increasing people’s autonomy to make decisions that affect their lives (Rowlands, 1995). The World Bank (2002) also maintains that empowerment is the expansion of freedom of choice and action. It means increasing one’s authority and control over the resources and decisions that affect one’s life. As people exercise real choice, they gain increased control over their lives. Poor people’s choices are extremely limited due to a lack of assets and their powerlessness to negotiate better terms for themselves with a range of institutions, both formal and informal. The World Bank’s definition of empowerment is consistent with Sen’s (1999) conceptualisation of the capability approach. Empowerment is regarded as “the expansion of assets and
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capabilities of poor people to participate in, negotiate with, influence, control, and hold accountable institutions that affect their lives” (World Bank, 2002:10). Access to information, inclusion and participation, accountability and local organisational capacity are considered the key components of empowerment (Ibid.).
Types of Sustainable Livelihoods Assets
There is recognition within the SLA that both households and individuals have strengths and assets irrespective of the socio-economic challenges that they are confronted with (Rakodi and Lloyd-Jones, 2002; Carney, 1998). The five different assets are as follows:
Human capital: includes skills, knowledge and ability to labour.
Social capital: this is about social relationships and social networks of support such as church groups, community stokvels or saving clubs, burial societies, traders’ association and income generating groups, political groups, and so forth. These are social resources on which people draw in pursuit of livelihoods or which they can rely on in times of crisis for support (Tacoli, 1999: 8).
Natural capital: land and natural resources, including resources such as water, firewood, grazing, and building materials.
Physical capital: physical infrastructure such as machinery, buildings, equipment, roads, etc.
Financial capital: access to finance, including wages, savings, pensions, credit and items that can be sold such as cattle, cars, furniture and recyclable materials, providing households with livelihood options. This refers to almost anything that can immediately be converted to cash. In the South African context this includes access to social grants such as the child support grant and old age pension.
Scoones (1998) maintains that more assets/capitals for sustainable livelihoods exist than the five noted above. While he mentions 'political capital' as a sixth asset, he also argues that there are many others.
45 Poor People’s Livelihood Strategies
The urban poor engage in a range of survival strategies in order to mitigate the impact of poverty whilst sustaining their livelihoods. Unlike people who depend on the formal sector, where a job is a source of livelihood, poor people’s livelihoods in the informal sector are diverse and often complex (Philips, 2005). Different household members find different sources of food, cash and support. Their livelihood strategies involve “many things: to sniff around and look for opportunities, to diversify by adding enterprise and to multiply activities and relationships”
(Chambers, 1997:165). Many of these activities are not classified as ‘employment’ in the formal sense. Nevertheless, Devey, Skinner, and Valodia (2006) recognise that the informal economy has grown both in size and importance. Increasingly, people who are socially and economically marginalised are actively involved in building their own businesses in the informal economy.
For instance, according to May, (2012:6) the rigid requirements of the formal economy have compelled millions of poor South Africans to establish stokvels. These are safety nets that provide financial security and social wellbeing. The evidence suggests that about 11,400,400 people belong to 8,118,307 stokvels in South Africa and that they collectively save R448 billion a year. These are people considered non-bankable or high risk by conventional financial institutions. The research further reveals that Gauteng has the highest (24 percent) stokvel membership, followed by Limpopo (20 percent), North West (11 percent) and KwaZulu-Natal (14 percent) which account for 70 percent of all stokvels and 69 percent of the stokvel population. The provinces with the lowest number of stokvels are Western Cape at 6 percent, Mpumalanga with 7 percent, and Eastern Cape and Free State both at 8 percent (May, 2012:6).
Unlike conventional banks, the entry requirements of stokvels are flexible as they are determined by members. Investing in alternative livelihoods such as stokvels provides the poor with obvious economic benefits. It is in this context that some commentators have pointed out the significant decline of the formal sector of the economy.
Chambers (1997) notes, that, diversifying income sources is important to the urban poor in order to reduce risks and uncertainty. Tacoli (2002) is of the view that the location of an informal settlement and the activities that take place in the neighbourhood (mining, manufacturing and agriculture) or surrounding areas, and the assets or resources people possess or can access
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determine the nature and the extent of survival strategies to sustain livelihoods. Other factors may include transport availability and costs.